In the opinion of many government contractors, this should be a short article. Many bidders give no thought to using the agency-level protest process pursuant to FAR 33.103 and agency FAR Supplements. They see no value in wasting their time and money on an agency-level protest that, in effect, finds a contractor asking a contracting officer “did you REALLY have good reasons for denying me that contract?” Bidders overwhelmingly prefer the protest alternatives of going to the Government Accountability Office (GAO) or the U.S. Court of Federal Claims (COFC) to protest.
There are good reasons, however, for considering agency-level protests in more detail. First, they have certain advantages for bidders that are overlooked. Second, there may well be increasing interest throughout the procurement arena in improving the agency-level protest process. A recent draft report to the Administrative Conference of the United States by Christopher Yukins of George Washington School of Law takes a serious look of the process. Using serious and detailed input from industry and government practitioners, the report proposes changes to the process and describes how these changes can benefit both contractors and agencies.
Advantages of Agency-Level Protests
It’s understandable why contractors may believe that an agency-level protest appears to be worthless. If the agency-level protest is to the contracting officer, she has a conflict of interest: her job of deciding who should win a contract is in conflict with her job under FAR 33.103(d)(3) to resolve a protest of her decision. And, as a practical matter, what reason would she have to change her decision? Undoubtedly, she has labored over the solicitation for months, even years and has reached a decision she believes is the right one.
Alternatively, if the agency-level protest is to someone higher than the contracting officer as allowed by the same FAR provision, the conflict of interest is not so apparent but lacks credibility for the same reason: a bidder’s belief that anyone in the agency making a decision on an agency action is always on the side of their friends in the agency and will protect the decision of the contracting officer come what may.
So one problem with an agency-level protest is that the bidder and the agency are on different sides.
But not always. And here’s one advantage of an agency-level protest. In the pre-award stage, the contracting officer and the bidder may be on the same side. For example, if the Q&A process has ended and bids are due but a vendor sees something in the solicitation that is a mistake, like a clearly erroneous NAICS code that nobody has noticed before, a pre-award protest to correct the error is something that a contracting officer may welcome.
Our firm has seen agency’s correct solicitation errors in response to an agency-level protest on several occasions. We often recommend that clients use the agency-level protest to resolve pre-award issues, or, perhaps more specifically, issues that arise before the deadline for submission of initial or subsequent offers. Although the client could protest to GAO, filing instead an agency-level protest in the pre-award context possibly has favorable customer-relationship impacts. It gives the contracting officer the chance to fix the solicitation error without the publicity and delay of a GAO protest.
Another advantage of an agency-level protest is that a bidder can use an agency-level protest to raise issues that cannot be protested to GAO. For example, GAO severely limits protests based on the protester’s claim that the winner should not have been found to be responsible, a protest argument that GAO’s regulation say it will generally not consider. 4 C.F.R. § 21.5. But, because the “jurisdiction” of an agency-level protest is not clearly described or limited in FAR, there is no prohibition on an agency considering such a protest.
Other advantages of an agency-level protest are its relative ease of filing – simply a letter to the contracting officer or other agency official and its relative low cost and short time frame, ideally 35 days from protest to decision.
But there are disadvantages other than the lack of credibility that the agency protest decision presents to contractors. One is knowing a contractor’s chances of winning; because decisions on agency-level protest are not published to the contractor community, this lack of transparency discourages agency-level protests. Another disadvantage lies with the “agency record” – FAR is silent on whether the agency must make a decision on that record and whether the protester has a right to see that decision record.
The Yukins Report
Professor Yukins’ (draft) report “Stepping Stones to Reform: Making Agency-Level Bid Protests Effective For Agencies and Bidders by Building on Best Practices from Across the Federal Government” deserves serious consideration from contractors as well as contracting officers. Here, only a few of the ideas will be mentioned.
Perhaps one of the most important points is his identification of the advantages to the agency of improving agency-level protests. He believes that the current agency-level protest process represents “a large missed opportunity.” (P.20.)
If well-administered, agency-level protests can dramatically reduce the time and attention agencies must devote to bid protests, for they allow agencies to handle procurement failures internally, quickly, and with minimum disruption. Making agency-level bid protests an effective alternative means of resolving vendor challenges would thus benefit federal agencies, by reducing the costs and delays normally caused by bid protests.
(P.5.)
Specific recommendations include:
- The government formalize the role of an “Agency Protest Official” in the agencies, so that official can make the agency-level bid protest function more accountable and coordinate other reforms;
He notes that “some vendor attorneys feared inherent bias” when the contracting officer decides agency-level protest. This appearance of bias could be addressed by the establishment of an Agency Protest Official (APO) who “would lend legitimacy and perceived fairness to the process, because the agency could separate the APO from the procurement process (compared to the head of the contracting activity or the general counsel, both of whom are part of the procurement decision making process).” (p.24).
- The government clarify the jurisdiction of agency-level protests, to make it clear that an agency (and its vendors) presumptively can address any type of procurement failure in the agency;
To deal with the fact that the FAR is silent on the jurisdiction of agency-level protests, he suggests this at p. 28:
A broad statement of jurisdiction would leave agency officials with clearer authority to address novel issues that emerge in a rapidly evolving procurement system, such as misuse of task order purchasing authorities, or problems relating to the new “electronic marketplaces” (commercial online marketplaces) being opened to user purchases by GSA.
- Agencies should maximize the administrative record shared with protesters, to make it easier for vendors and agencies to resolve contentious and potentially disruptive issues quickly and efficiently through agency-level bid protests;
This recommendation addresses the issue of a lack of record which he describes at p. 36:
Any errors in the agency decision-making are most likely found in the administrative record on which the challenged decision was made. But FAR currently has almost no guidance on what that record should consist of. Nor is there any requirement that the agency provide that record to the protestor.
- Agencies should publish data on agency-level protest outcomes, including corrective action, to enhance vendor confidence in agency-level protests.
He believes this recommendation would address the lack of transparency:
There is little, if any, transparency to the process resulting in protesters not knowing how difficult it is for a protester to win. This statistic is important because “the likelihood of success informs protesters’ willingness to use the protest system.” The transparency from publishing protest outcomes could increase the use of agency-level protests. P. 48.
This brief summary of the Yukins Report cannot do justice to the wealth of relevant information in the report. Especially interesting is the information gathered from agency participants (e.g., contracting officers, agency counsel) and protest practitioners (e.g., government contractors, protest counsel).
One issue is obviously the vehicle an agency can use to implement changes it believes to be worthwhile. Although changes to federal statutes or regulations like the FAR are one way of implementing these recommendations, agencies might consider taking the initiative urged by several FAR provisions.
For example, according to FAR 1.102:
In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.
Also, see FAR 1.102-4:
(e) …If a policy or procedure, or a particular strategy or practice, is in the best interest of the Government and is not specifically addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, Government members of the Team should not assume it is prohibited. Rather, absence of direction should be interpreted as permitting the Team to innovative and use sound business judgment that is otherwise consistent with law and within the limits of their authority. Contracting officers should take the lead in encouraging business process innovations and ensuring that business decisions are sound.
To the extent that federal law and regulations are silent on many agency-level protest issues as described in the Yukins Report, these issues could be resolved by the agencies themselves.
Of course, whether the agency-level protest process will change in the future is unknown. But the Yukins Report gets the discussion of this critical issue off to a meaningful start.
Terry O’Connor is a Partner and Director of Government Contracts at Berenzweig Leonard.